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HIGH PERFORMANCE BOARD. 17 August 2011. Craig Hunter FCIS. Craig Hunter FCIS - my career. Chartered Secretary in Public Practice 30 years experience, with award winning business FTSE and global companies, charities, private groups, sporting organisations, sole traders - PowerPoint PPT Presentation

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  • HIGH PERFORMANCE BOARD

    17 August 2011Craig Hunter FCIS

  • Craig Hunter FCIS - my career

    Chartered Secretary in Public Practice 30 years experience, with award winning businessFTSE and global companies, charities, private groups, sporting organisations, sole traders British Swimming independent directorEuropean Swimming technical committee memberInternational swimming refereeBritish Swimming team manager 1989-2006Olympic Games 2000, 2004, 2008Commonwealth Games 1998, 2002, 2006, 2010UK Sport Mission Control panel member

  • Programme

    Governance structure & board compositionDirectors duties and responsibilitiesEffective performancePurpose of the boardIndependent directorsCompetenciesBehaviourGovernance oversightBoard evaluation

  • Typical corporate structureAnnual General MeetingExecNon-exec

  • Typical sport structure?Annual Meeting

  • Legal status

    Incorporated bodyCompany limited by shares of guaranteeArticles of associationCompanies Act 2006

    CharityTrust deed Charities Act 2006

    Unincorporated bodyRules

  • Round table discussion

    Briefly outline your board composition and structure as well as the challenges you face

  • The perfect model - 1

    Independent chairInternal or external appointment?Dynamic CEOSupported by executive management teamfinance, legal, marketing, performance/participationAppropriate non-executive/independent directorsSkills based v- regional/Home Country representativesAppointed v- elected

  • The perfect model - 2Board composition and size Diversity Candidates able and willing to challenge conventionBalance of executive and independent/non-executiveBroad range of experienceAppointmentProcess, rolling v- fixed term, terms DutiesDelegations of authority Terms of referenceEffective performance Board evaluationSuccession planning

  • Directors duties and responsibilities

    Companies Act 2006Duty to act within powerspromote the success of the companyexercise independent judgementexercise reasonable skill, care and diligenceavoid conflicts of interestnot accept benefits from third partiesdeclare interest in proposed transactiondeclare interests in existing transactions

  • Dept. Business Innovation & SkillsSimple high-level guidance for directors:Act in the companys best interests, taking everything you think relevant into accountObey the companys constitution and decisions taken under itBe honest, and remember that the companys property belongs to it and not to you or its shareholdersBe diligent, careful and well informed about the companys affairs. If you have any special skills or experience, use themMake sure the company keeps records of its decisionsRemember that you remain responsible for the work you give to othersAvoid situations where your interests conflict with those of the company. When in doubt disclose potential conflicts quicklySeek external advice where necessary, particularly if the company is in financial difficulty

  • Effective performance

    Effective directors

    Effective decision-making

    Effective board performance

    Board evaluation

  • Round table discussion

    Describe your role within your organisation/sport

    What attributes/skills do you have?

    What constrains you/your board/your organisation?

  • The purpose of the boardKey decision-making body responsible for leadership, integrity, performance, and risk profile of companyBoard should determine the purpose of its meetingsReassert the distinction between governance, strategy and operational mattersEmphasise the importance of the board proactively crafting policies, processes and systems to ensure the delivery of its strategic objectivesEthical sensitivity?Consider how the board, collectively and in terms of individual contributions, might improve the overall effectiveness of their responsibilities in areas such as decision-making, strategy development and financial analysis

  • Skill levels in the boardroom

    Importance of inductionDevelopment and training Need for on-going support and developmentAccess to operations and staffExternal adviceBenchmarking directors performance evaluation

  • Competencies

    A breadth of experienceTeam player who leaves their ego at the doorIndependent adviser, able to challenge as well as supportCommitted and preparedArticulate communicator and good listener Sharp mind and good judgementVisionary, creative, and passionateBuild strong relationships and act as ambassadorsSelf-confident without being dogmaticEnhance their contribution through feedback

    Source: Whitehead Mann

  • Weaknesses

    Being a passenger or nodding dogCritical but not supportive not adding valueStill acting as a Chief Executive or frustrated Executive/DirectorSloppy thinking or not up to the jobSelf centredDemanding too much detail and overloadingUnpreparedMore on broadcast than receiveLacking courage to disagreeDivisive and dogmaticSource: Whitehead Mann

  • The independent director

  • The Boardroom FrameworkPurposePeopleProcessDrivesPromotesFacilitatesOutstandingPerformanceStrongManagementQuality WorkingPractices

  • Boardroom behaviour

    ICSA report concluded:

    Best practice boardroom behaviour may be characterised byA clear understanding of the role of the board Independent thinkingChallenge which is constructive, confident, principled and proportionateRigorous debate and Supportive decision-making environment

  • Appropriate boardroom behaviours

    Develop a culture of constructive and robust challenge in the boardroomAvoidance of groupthink cultureInterrelationships within the boardroomGroup dynamics, as well as the contribution of (key) individualsInteraction with employeesSocial context (dinners, away-days, events)Ground rules for meetings

  • Board agenda and meetings

    Standard agenda items and annual planAllocate sufficient timePresentations by key executivesRole of board papersRobust discussion & challengeBehaviourCorporate message - unanimityAccountabilityUse and role of committeesFocus on strategy, financial management, governance, performance/participation, risk

  • Governance oversightThere are three levelsInstitutional are the corporate governance policies and architecture fit for purpose?Organisational has management installed adequate processes and systems?Behavioural are directors exhibiting the appropriate behaviour?

    Sport & Recreation AllianceVoluntary Code of Good Governance for the Sport and Recreation Sector

  • Board evaluation - 1

    The Walker Review:

    The board should undertake a formal and rigorous evaluation of its performance, and that of committees of the board, with external facilitation of the process every second or third year

  • Board evaluation - 2Who is involved?ChairmanDirectors (executive & independent)StaffIndependent observer?Process: robust assessment of strategic plan and outcomesFrequency and facilitationPotential conflicts of interestNature and importance of board evaluationHow outputs of the process can be meaningfully disclosed without compromising confidentialityNotification to stakeholders

  • Resourceswww.icsa.org.ukCorporate, voluntary & community sectorCommittee terms of referenceAudit, Executive, Nomination, Remuneration, RiskGuidanceJoining the right board: due diligence for prospective directorsInduction of new directorsDirectors dutiesJob/role descriptionsFinancial Reporting CouncilThe UK Corporate Governance Code (June 2010)Guidance on Board Effectiveness (March 2011)

  • www.versec.co.ukM: 07771 814929T : 01727 855512F : 01727 855501E : craig.hunter@versec.co.ukRegistered in England at 39 Alma Road St Albans AL1 3ATCompany Number: 3999397VAT Number:706 0811 65Sport Management Consultancy

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